Xander strikes two realty deals worth Rs 3,000 crore

First deal is where it bought an SEZ in Chennai and second one is a mall acquisition in Chandigarh

Private equity group Xander has signed two big property deals in the country worth Rs 3,000 crore.

In one of the largest private equity deals in real estate in recent years, Xander bought a functioning special economic zone in Chennai for Rs 2,290 crore from Shriram Properties.

The deal involves buying a 100 per cent stake in Gateway SEZ for Rs 1,250 crore and a Rs 1,040 crore investment in the project, according to Xander.

The deal involves 1.7 million sq ft of occupied and operational SEZ and a partnership with Shriram to deliver another 1.9 million sq ft under construction.

Shriram will continue to develop and own the residential and retail components comprising 2.6 million sq ft while Xander will develop an additional 1 million sq ft.

Last year, Canada-based Brookfield bought 5 million sq ft of commercial property from the Hiranandani group for $1 billion (about Rs 6,700 crore then).

"The acquisition demonstrates our continued interest in large, well-positioned assets with growth potential across gateway cities in India, and nicely complements our existing office portfolio," said Rohan Dikti, senior partner at the Xander group.

In another transaction, Virtuous Retail South Asia (VRSA), a joint venture between Xander and Dutch pension fund APG, bought a 2 million sq ft mall in Chandigarh called North Country Mall from Sun Apollo-Gumberg for Rs 700 crore.

This is the largest mall acquisition this year and the deal included repaying debts of around Rs 400 crore. VRSA beat other contenders such as The Phoenix Mills and Blackstone.

The deal comes six months after APG and Xander formed a joint venture for Xander's mall assets in which APG bought a 77 per cent stake for Rs 2,000 crore.

North Country Mall is one of the largest malls operating in Punjab. Built on 22 acres on National Highway 21, it has a leasable area of 1 million sq ft.  It has anchor tenants such as H&M, Zara, PVR, Forever 21, Westside, Lifestyle and Home Center. VRSA will invest in rebranding the mall as a VR flagship centre.

“The acquisition expands our footprint into north India, has numerous portfolio synergies, and is value accretive to our stakeholders, including retail partners and investors,” said Sid Yog, chairman of the board, VRSA.

Deals in retail properties have shot up in recent years. Last year, Blackstone bought a 50 per cent stake in a Pune mall for Rs 600 crore. Before that, it bought a mall in Navi Mumbai from L&T Realty for Rs 1,400 crore.

Blackstone has set up a company called Nexus Malls to manage the malls.

The Phoenix Mills is in a joint venture with Canadian pension fund CPPIB for buying and developing malls. 

Details of the deal

• Xander buys a operational SEZ near Chennai for Rs 2,290 crore from Shriram Properties 

• Buys 100% in Gateway SEZ for Rs 1250 crore and invests Rs 1,040 crore in the project 

• Deal involves 1.7 mn sq ft of operational SEZ and a pact with Shriram to deliver another 1.9 mn sq ft 

• Virtuous Retail South Asia buys a two mn sq ft mall in Chandigarh from Sun Apollo